SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the Quarterly Period Ended March 31, 2000
Or
[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period from to
Commission file number 0-14217
ML VENTURE PARTNERS II, L.P.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 13-3324232
- --------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
4 World Financial Center, 26th Floor
New York, New York 10080
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (212) 449-1000
Not applicable
- --------------------------------------------------------------------------------
Former name, former address and former fiscal year, if changed since last report
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No ------------------
<PAGE>
ML VENTURE PARTNERS II, L.P.
INDEX
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements.
Balance Sheets as of March 31, 2000 (Unaudited) and December 31, 1999
Schedule of Portfolio Investments as of March 31, 2000 (Unaudited)
Statements of Operations for the Three Months Ended March 31, 2000 and 1999
(Unaudited)
Statements of Cash Flows for the Three Months Ended March 31, 2000 and 1999
(Unaudited)
Statement of Changes in Partners' Capital for the Three Months Ended March 31,
2000 (Unaudited)
Notes to Financial Statements (Unaudited)
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
Item 3. Quantitative and Qualitative Disclosures about Market Risk.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
Item 2. Changes in Securities.
Item 3. Defaults upon Senior Securities.
Item 4. Submission of Matters to a Vote of Security Holders.
Item 5. Other Information.
Item 6. Exhibits and Reports on Form 8-K.
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
ML VENTURE PARTNERS II, L.P.
BALANCE SHEETS
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
March 31, 2000 December 31,
(Unaudited) 1999
ASSETS
Portfolio investments, at fair value (cost $2,964,006 as of
March 31, 2000 and December 31, 1999) $ 5,293,873 $ 5,414,349
Short-term investments, at amortized cost - 8,471,368
Cash and cash equivalents 642,103 1,059,973
---------------- ----------------
TOTAL ASSETS $ 5,935,976 $ 14,945,690
================ ================
LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
Cash distribution payable $ - $ 8,704,964
Accounts payable and accrued expenses 98,141 91,518
Due to Management Company 50,000 166,235
Due to Independent General Partners 4,500 -
---------------- ----------------
Total liabilities 152,641 8,962,717
---------------- ----------------
Partners' Capital:
Managing General Partner 337,426 338,194
Individual General Partners 104 107
Limited Partners (120,000 Units) 3,115,938 3,194,329
Unallocated net unrealized appreciation of investments 2,329,867 2,450,343
---------------- ----------------
Total partners' capital 5,783,335 5,982,973
---------------- ----------------
TOTAL LIABILITIES AND PARTNERS' CAPITAL $ 5,935,976 $ 14,945,690
================ ================
</TABLE>
See notes to financial statements.
<PAGE>
ML VENTURE PARTNERS II, L.P.
SCHEDULE OF PORTFOLIO INVESTMENTS (Unaudited)
As of March 31, 2000
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
Initial
Investment
Company / Position Date Cost Fair Value
- ------------------- --------------- ------------- ---------------
Burns International Services Corporation* (A)
Protective services
500,000 shares of Common Stock Sept. 1988 $ 2,500,000 $ 4,200,000
- -------------------------------------------------------------------------------------------------------------------------------
Brightware, Inc.
Client/server and internet software development tools
and services
200,057 shares of Common Stock May 1995 44,703 300,086
- -------------------------------------------------------------------------------------------------------------------------------
Raytel Medical Corporation(A)
Pacemaker monitoring service and MRI centers
62,500 shares of Common Stock Feb. 1990 241,639 156,250
Options to purchase 27,969 shares of Common Stock
at $1.42 per share, expiring on 10/31/01 0 30,207
- -------------------------------------------------------------------------------------------------------------------------------
ReGen Biologics, Inc.
Joint and spine regeneration products
72,800 shares of Common Stock Apr. 1991 364 263,900
62,400 shares of Preferred Stock 114,400 226,200
- -------------------------------------------------------------------------------------------------------------------------------
Stereotaxis, Inc.
Drug delivery and brain surgery systems
21,632 shares of Common Stock Apr. 1990 216 16,224
134,674 shares of Preferred Stock 62,684 101,006
- -------------------------------------------------------------------------------------------------------------------------------
Total Portfolio Investments $ 2,964,006 $ 5,293,873
---------------------------------
Supplemental Information: Liquidated Portfolio Investments (B)
Net
Cost Realized Gain Return
Totals from Liquidated Portfolio Investments $ 113,568,990 $117,304,395 $ 30,873,385
================ ============= =============
Combined Net Combined
Unrealized and Fair Value
Cost Realized Gain and Return
Totals from Active and Liquidated Portfolio Investments $ 116,532,996 $119,634,262 $ 236,167,258
=============== ============ =================
</TABLE>
(A) Public company
(B) Amounts provided for "Supplemental Information: Liquidated Portfolio
Investments" are cumulative from inception through March 31, 2000.
* May be deemed an affiliated person of the Partnership as defined in the
Investment Company Act of 1940.
See notes to financial statements.
<PAGE>
ML VENTURE PARTNERS II, L.P.
STATEMENTS OF OPERATIONS (Unaudited)
For the Three Months Ended March 31,
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
2000 1999
--------------- ---------------
INVESTMENT INCOME AND EXPENSES
Income:
Interest from short-term investments $ 44,924 $ 22,972
Other income from portfolio investments 120 530
-------------- ----------------
Total investment income 45,044 23,502
-------------- ----------------
Expenses:
Management fee 50,000 50,000
Professional fees 16,250 26,340
Mailing and printing 33,156 25,467
Independent General Partners' fees 24,000 24,000
Custodial fees 800 1,011
Miscellaneous - 474
-------------- ----------------
Total investment expenses 124,206 127,292
-------------- ----------------
NET INVESTMENT LOSS (79,162) (103,790)
Net realized loss from portfolio investments - (363,378)
-------------- ----------------
NET REALIZED LOSS FROM OPERATIONS (79,162) (467,168)
Change in net unrealized appreciation of portfolio investments (120,476) (792,382)
-------------- ----------------
NET DECREASE IN NET ASSETS RESULTING
FROM OPERATIONS $ (199,638) $ (1,259,550)
============== ================
</TABLE>
See notes to financial statements.
<PAGE>
ML VENTURE PARTNERS II, L.P.
STATEMENTS OF CASH FLOWS (Unaudited)
For the Three Months Ended March 31,
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
2000 1999
--------------- -------------
CASH FLOWS USED FOR OPERATING ACTIVITIES
Net investment loss $ (79,162) $ (103,790)
Adjustments to reconcile net investment loss to cash used for operating
activities:
Decrease in accrued interest from short-term investments 46,538 31,428
Decrease in accrued interest receivable - other - 1,291
Decrease in payables, net (105,112) (16,609)
-------------- -------------
Cash used for operating activities (137,736) (87,680)
-------------- -------------
CASH FLOWS PROVIDED FROM INVESTING ACTIVITIES
Net return of cost of short-term investments 8,424,830 3,960,777
Net proceeds from the sale of portfolio investments - 475,435
-------------- -------------
Cash provided from investing activities 8,424,830 4,436,212
-------------- -------------
CASH FLOWS USED FOR FINANCING ACTIVITES
Cash distribution paid to partners (8,704,964) (4,514,772)
-------------- -------------
Decrease in cash and cash equivalents (417,870) (166,240)
Cash and cash equivalents at beginning of period 1,059,973 423,675
-------------- -------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 642,103 $ 257,435
============== =============
</TABLE>
See notes to financial statements.
<PAGE>
ML VENTURE PARTNERS II, L.P.
STATEMENT OF CHANGES IN PARTNERS' CAPITAL (Unaudited)
For the Three Months Ended March 31, 2000
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
Unallocated
Managing Individual Net Unrealized
General General Limited Appreciation
Partner Partners Partners of Investments Total
------------ ---------- -------------- --------------- ----------------
Balance as of beginning of period $ 338,194 $ 107 $ 3,194,329 $ 2,450,343 $ 5,982,973
Net investment loss (768) (3) (78,391) - (79,162)
Change in unrealized
appreciation of investments - - - (120,476) (120,476)
------------- -------- -------------- -------------- ----------------
Balance as of end of period $ 337,426 $ 104 $ 3,115,938 $ 2,329,867 $ 5,783,335
============= ======== ============== ============== ================
</TABLE>
(A) The net asset value per unit of limited partnership interest ("Unit"),
including an assumed allocation of net unrealized appreciation of
investments, was $41 as of March 31, 2000. Additionally, cumulative cash
distributions paid to limited partners from inception to March 31, 2000
totaled $1,656 per Unit.
See notes to financial statements.
<PAGE>
ML VENTURE PARTNERS II, L.P.
NOTES TO FINANCIAL STATEMENTS (Unaudited)
1. Organization and Purpose
The Partnership's objective is to achieve long-term capital appreciation from
its portfolio of venture capital investments in new and developing companies and
other special investment situations. The Partnership does not engage in any
other business or activity. The Partnership is scheduled to terminate no later
than December 31, 2001. However, the Managing General Partner is working toward
liquidating the Partnership's remaining assets and terminating the Partnership
as soon as practical with the goal of maximizing returns to partners.
2. Significant Accounting Policies
Valuation of Investments - Short-term investments are carried at amortized cost,
which approximates market. Portfolio investments are carried at fair value, as
determined quarterly by the Sub-Manager under the supervision of the Individual
General Partners and the Managing General Partner. Publicly-held portfolio
securities are valued at the closing public market price on the valuation date,
discounted by a factor of up to 50% for sales restrictions, if any. Factors
considered in the determination of an appropriate discount include, underwriter
lock-up or Rule 144 trading restrictions, insider status where the Partnership
either has a representative serving on the company's Board of Directors or is
greater than a 10% shareholder, and other liquidity factors such as the size of
the Partnership's position in a given company compared to the trading history of
the public security. Privately-held portfolio securities are carried at cost
until significant developments affecting the portfolio company provide a basis
for change in valuation. The fair value of private securities is adjusted to
reflect 1) meaningful third-party transactions in the private market or 2)
significant progress or slippage in the development of the company's business
such that cost is no longer reflective of fair value. As a venture capital
investment fund, the Partnership's portfolio investments involve a high degree
of business and financial risk that can result in substantial losses. The
Sub-Manager considers such risks in determining the fair value of the
Partnership's portfolio investments.
Use of Estimates - The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
<PAGE>
ML VENTURE PARTNERS II, L.P.
NOTES TO FINANCIAL STATEMENTS (Unaudited), continued
Investment Transactions - Investment transactions are recorded on the accrual
method. Portfolio investments are recorded on the trade date, the date the
Partnership obtains an enforceable right to demand the securities or payment
therefor. Realized gains and losses on investments sold are computed on a
specific identification basis.
Income Taxes - No provision for income taxes has been made since all income and
losses are allocable to the partners for inclusion in their respective tax
returns. The Partnership's net assets for financial reporting purposes differ
from its net assets for tax purposes. Net unrealized appreciation of investments
of approximately $2.3 million as of March 31, 2000, was recorded for financial
statement purposes, but was not recognized for tax purposes. Additionally, from
inception to March 31, 2000, timing differences of approximately $2.4 million
have been deducted on the Partnership's financial statements and syndication
costs relating to the offering of limited partnership interests totaling $11.3
million were charged to partners' capital on the financial statements. These
amounts have not been deducted or charged against partners' capital for tax
purposes.
Statements of Cash Flows - The Partnership considers its interest-bearing cash
account to be a cash equivalent.
3. Allocation of Partnership Profits and Losses
Pursuant to the Partnership Agreement, the Managing General Partner is
allocated, on a cumulative basis over the life of the Partnership, 20% of the
Partnership's aggregate investment income and net realized gains and losses from
venture capital investments, provided such amount is positive. All other gains
and losses of the Partnership are allocated among all partners (including the
Managing General Partner) in proportion to each partners' respective capital
contribution to the Partnership. From its inception to March 31, 2000, the
Partnership had a $121.6 million net realized gain from its venture capital
investments, including interest and other income from portfolio investments
totaling $4.3 million.
4. Related Party Transactions
The Management Company is responsible for the management and administrative
services necessary for the operation of the Partnership and receives a
management fee at the annual rate of 2.5% of the gross capital contributions to
the Partnership, reduced by selling commissions, organizational and offering
expenses paid by the Partnership, capital distributed and realized capital
losses with a minimum annual fee of $200,000.
Each of the three Independent General Partners receives $20,000 annually in
quarterly installments, $1,500 for each meeting of the General Partners attended
or for each other meeting, conference or engagement in connection with
Partnership activities at which attendance by an Independent General Partner is
required and $1,500 for each audit committee meeting attended ($500 if an audit
committee meeting is held on the same day as a meeting of the Independent
General Partners).
<PAGE>
ML VENTURE PARTNERS II, L.P.
NOTES TO FINANCIAL STATEMENTS (Unaudited), continued
5. Classification of Portfolio Investments
As of March 31, 2000, the Partnership's investments in portfolio companies were
categorized as follows:
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
% of
Type of Investments Cost Fair Value Net Assets*
- ------------------- -------------- --------------- -----------
Common Stock and Warrants $ 2,786,922 $ 4,966,667 85.88%
Preferred Stock 177,084 327,206 5.66%
-------------- --------------- -------
Total $ 2,964,006 $ 5,293,873 91.54%
============== =============== ======
Country/Geographic Region
Midwestern U.S. $ 2,562,900 $ 4,317,230 74.65%
Western U.S. 401,106 976,643 16.89%
-------------- --------------- ------
Total $ 2,964,006 $ 5,293,873 91.54%
============== =============== ======
Industry
Protective Services $ 2,500,000 $ 4,200,000 72.63%
Biotechnology 177,664 607,330 10.50%
Medical Devices and Services 241,639 186,457 3.22%
Computer Software 44,703 300,086 5.19%
-------------- --------------- ------
Total $ 2,964,006 $ 5,293,873 91.54%
============== =============== ======
</TABLE>
* Percentage of net assets is based on fair value.
6. Interim Financial Statements
In the opinion of the Managing General Partner, the unaudited financial
statements as of March 31, 2000, and for the three month period then ended,
reflect all adjustments necessary for the fair presentation of the results of
the interim period.
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
-----------------------------------------------------------------
Liquidity and Capital Resources
As of March 31, 2000, the Partnership held $642,103 in an interest-bearing cash
account. Interest earned from this account and other short-term investments
totaled $44,924 for the three months ended March 31, 2000. Interest earned in
future periods is subject to fluctuations in interest rates and changes in
amounts available for investment. Funds needed to cover the Partnership's future
operating expenses and follow-on investments, if any, will be obtained from
existing cash reserves, interest and other investment income received and
proceeds from the sale of portfolio investments.
The Partnership is scheduled to terminate no later than December 31, 2001.
However, the Managing General Partner is continuing to work toward liquidating
the Partnership's remaining assets and terminating the Partnership as soon as
practical, with the goal of maximizing returns to partners.
Generally, net proceeds received from the sale of portfolio investments are
distributed to partners as soon as practicable, after an adequate reserve for
operating expenses and follow-on investments in the remaining portfolio
companies.
Results of Operations
For the three months ended March 31, 2000 and 1999, the Partnership had a net
realized loss from operations of $79,162 and 467,168, respectively. Net realized
gain or loss from operations is comprised of 1) net realized gain or loss from
portfolio investments and 2) net investment income or loss (interest, dividend
and other portfolio income less operating expenses).
Realized Gains and Losses from Portfolio Investments - The Partnership had no
realized gains or losses from portfolio investments for the three months ended
March 31, 2000.
For the three months ended March 31, 1999, the Partnership had a $363,378 net
realized loss resulting from the write-off of its remaining investment in
Neocrin Company due to continued operating and financial difficulties at the
company.
Investment Income and Expenses - For the three months ended March 31, 2000 and
1999, the Partnership had a net investment loss of $79,162 and $103,790,
respectively. The favorable change in net investment loss for the 2000 period
compared to the same period in 1999, primarily was attributable to a $21,542
increase in investment income. The increase in investment income primarily
resulted from an increase in interest from short-term investments, reflecting an
increase in funds invested in such securities during the first quarter of 2000
compared to the same period in 1999 resulting from higher cash balances held
pending distribution to partners. Operating expenses of $124,206 for the three
months ended March 31, 2000 were slightly lower than operating expenses of
$127,292 for the three months ended March 31, 1999. An increase in mailing and
printing expenses of $7,689 was more than offset by a reduction in professional
fees of $10,090. The increase in mailing and printing reflects additional
mailings to limited partners during the 2000 period. The decrease in
professional fees resulted from reduced legal and outside accounting fees
reflecting the reduced operating activity as the Partnership proceeds with the
liquidation of its remaining assets.
The Management Company is responsible for the management and administrative
services necessary for the operation of the Partnership. The Management Company
receives a management fee at an annual rate of 2.5% of the gross capital
contributions to the Partnership, reduced by selling commissions, organizational
and offering expenses paid by the Partnership, return of capital and realized
capital losses, with a minimum annual fee of $200,000. Such fee is determined
and payable quarterly. The management fee was $50,000 for each of the
three-month periods ended March 31, 2000 and 1999. The management fee and other
operating expenses are paid with funds provided from operations and from
existing cash reserves.
Unrealized Gains and Losses and Changes in Unrealized Appreciation of Portfolio
Investments - For the three months ended March 31, 2000, the Partnership had a
$120,476 decrease in net unrealized appreciation reflecting the reduced fair
value of its remaining publicly held securities as of March 31, 2000.
For the three months ended March 31, 1999, the Partnership reduced the fair
value of its remaining portfolio investments on a net basis by $1,155,760.
Offsetting this decrease was the transfer of $363,378 of unrealized loss to
realized loss relating to the write-off of Neocrin Company during the quarter,
as discussed above. As a result, the Partnership had a $792,382 decrease in net
unrealized appreciation of investments for the three months ended March 31,
1999.
Net Assets - Changes to net assets resulting from operations are comprised of 1)
net realized gain or loss from operations and 2) changes to net unrealized
appreciation of portfolio investments.
As of March 31, 2000, the Partnership's net assets were $5,783,335, reflecting a
decrease of $199,638 from net assets of $5,982,973 as of December 31, 1999. This
decrease reflects the $79,162 net realized loss from operations and the $120,476
decrease in net unrealized appreciation of investments for the three months
ended March 31, 2000.
As of March 31, 1999, the Partnership's net assets were $14,378,652, reflecting
a decrease of $1,259,550 from net assets of $15,638,202 as of December 31, 1998.
This decrease reflects the $467,168 net realized loss from operations and the
$792,382 decrease in net unrealized appreciation of investments for the three
months ended March 31, 1999.
Gains and losses from investments are allocated to partners' capital accounts
when realized, in accordance with the Partnership Agreement (see Note 3 of Notes
to Financial Statements). However, for purposes of calculating the net asset
value per unit of limited partnership interest, net unrealized appreciation of
investments has been included as if such net unrealized appreciation had been
realized and allocated to the limited partners in accordance with the
Partnership Agreement. Pursuant to such calculation, the net asset value per
$1,000 Unit as of March 31, 2000 and December 31, 1999 was $41 and $43,
respectively.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
The Partnership is subject to market risk arising from changes in the value of
its portfolio investments, short-term investments and interest-bearing cash
equivalents, which may result from fluctuations in interest rates and equity
prices. The Partnership has calculated its market risk related to its holdings
of these investments based on changes in interest rates and equity prices
utilizing a sensitivity analysis. The sensitivity analysis estimates the
hypothetical change in fair values, cash flows and earnings based on an assumed
10% change (increase or decrease) in interest rates and equity prices. To
perform the sensitivity analysis, the assumed 10% change is applied to market
rates and prices on investments held by the Partnership at the end of the
accounting period.
The Partnership's portfolio investments had an aggregate fair value of
$5,293,873 as of March 31, 2000. An assumed 10% decline from this fair value,
including an assumed 10% decline of the per share market prices of the
Partnership's publicly-traded securities, would result in a reduction to the
fair value of such investments and an unrealized loss of $529,387.
Market risk relating to the Partnership's interest-bearing cash equivalents held
as of March 31, 2000 is considered to be immaterial.
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
-----------------
The Partnership is not party to any material pending legal proceedings.
Item 2. Changes in Securities.
---------------------
Not applicable.
Item 3. Defaults Upon Senior Securities.
-------------------------------
Not applicable.
Item 4. Submission of Matters to a Vote of Security Holders.
---------------------------------------------------
No matter was submitted to a vote of security holders during the period covered
by this report.
Item 5. Other Information.
-----------------
Not applicable.
<PAGE>
Item 6. Exhibits and Reports on Form 8-K.
--------------------------------
(a) Exhibits
(3) (a) Amended and Restated Certificate of Limited
Partnership of the Partnership, dated as of
January 12, 1987. (1)
(3) (b) Amended and Restated Certificate of Limited
Partnership of the Partnership, dated July 27,
1990. (2)
(3) (c) Amended and Restated Certificate of Limited
Partnership of the Partnership, dated March 25,
1991. (3)
(3) (d) Amended and Restated Agreement of Limited
Partnership of the Partnership, dated as of
May 4, 1987. (4)
(3) (e) Amendment No. 1 dated February 14, 1989 to
Amended and Restated Agreement of Limited
Partnership of the Partnership. (5)
(3) (f) Amendment No. 2 dated July 27, 1990 to Amended
and Restated Agreement of Limited Partnership
of the Partnership. (2)
(3) (g) Amendment No. 3 dated March 25, 1991 to Amended
and Restated Agreement of Limited Partnership
of the Partnership. (3)
(3) (h) Amendment No. 4 dated May 23, 1991 to Amended
and Restated Agreement of Limited Partnership
of the Partnership. (6)
(10) (a) Management Agreement dated as of May 23, 1991
among the Partnership, Management Company and the
Managing General Partner. (6)
(10) (b) Sub-Management Agreement dated as of May 23,
1991 among the Partnership, Management Company,
the Managing General Partner and the Sub-Manager.
(8)
(27) Financial Data Schedule.
(28) Prospectus of the Partnership dated February 10,
1987 filed with the Securities and Exchange
Commission pursuant to Rule 424(b) under the
Securities Act of 1933, as supplemented by a
supplement thereto dated April 21, 1987 filed
pursuant to Rule 424(c) under the Securities Act
of 1933. (7)
(b) No reports on Form 8-K have been filed during the
quarter for which this report is filed.
<PAGE>
(1) Incorporated by reference to the Partnership's Annual Report on Form
10-K for the year ended December 31, 1988 filed with the
Securities and Exchange Commission on March 27, 1989.
(2) Incorporated by reference to the Partnership's Quarterly Report on
Form 10-Q for the quarter ended September 30, 1990 filed
with the Securities and Exchange Commission on November 14, 1990.
(3) Incorporated by reference to the Partnership's Annual Report on Form
10-K for the year ended December 31, 1990 filed with the
Securities and Exchange Commission on March 28, 1991.
(4) Incorporated by reference to the Partnership's Quarterly Report on
Form 10-Q for the quarter ended June 30, 1987 filed with
the Securities and Exchange Commission on August 14, 1987.
(5) Incorporated by reference to the Partnership's Quarterly Report on
Form 10-Q for the quarter ended March 31, 1989 filed with
the Securities and Exchange Commission on May 15, 1989.
(6) Incorporated by reference to the Partnership's Quarterly Report on
Form 10-Q for the quarter ended June 30, 1991 filed with
the Securities and Exchange Commission on August 14, 1991.
(7) Incorporated by reference to the Partnership's Quarterly Report on
Form 10-Q for the quarter ended March 31, 1987 filed with
the Securities and Exchange Commission on May 15, 1987.
(8) Incorporated by reference to the Partnership's Annual Report on Form
10-K for the year ended December 31, 1992 filed with the
Securities and Exchange Commission on March 26, 1993.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
ML VENTURE PARTNERS II, L.P.
By: MLVPII Co., L.P.,
its Managing General Partner
By: Merrill Lynch Venture Capital Inc.,
its General Partner
By: /s/ Kevin K. Albert
-----------------------
Kevin K. Albert
President
(Principal Executive Officer)
By: /s/ James V. Bruno
-----------------------
James V. Bruno
Vice President & Treasurer
(Principal Financial and Accounting Officer)
By: /s/ Michael Giobbe
-----------------------
Michael Giobbe
Vice President
Date: May 15, 2000
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM ML VENTURE
PARTNERS II, L.P.'S QUARTERLY REPORT ON FORM 10-Q FOR THE PERIOD ENDED MARCH 31,
2000 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-1-2000
<PERIOD-END> MAR-31-2000
<INVESTMENTS-AT-COST> 2,964,006
<INVESTMENTS-AT-VALUE> 5,293,873
<RECEIVABLES> 0
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 642,103
<TOTAL-ASSETS> 5,935,976
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 152,641
<TOTAL-LIABILITIES> 152,641
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 120,000
<SHARES-COMMON-PRIOR> 120,000
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 2,329,867
<NET-ASSETS> 5,783,335
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 45,044
<OTHER-INCOME> 0
<EXPENSES-NET> 124,206
<NET-INVESTMENT-INCOME> (79,162)
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> (120,476)
<NET-CHANGE-FROM-OPS> (199,638)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 0
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> (199,638)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 5,883,154
<PER-SHARE-NAV-BEGIN> 43
<PER-SHARE-NII> (1)
<PER-SHARE-GAIN-APPREC> (1)
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 41
<EXPENSE-RATIO> 0
</TABLE>
